March inflation hits 4.1% on fuel, rice

Headline inflation accelerated to 4.1 percent in March from 2.4 percent in February, driven mainly by higher domestic petroleum prices, rising electricity rates, and faster food inflation, according to figures released April 7 by the Philippine Statistics Authority and statements from the Bangko Sentral ng Pilipinas and the Department of Economy, Planning, and Development.

Inflation is the rate at which prices increase over time. A higher inflation rate means families have to spend more for the same food, transport, electricity, and other daily needs.

The March reading exceeded the BSP’s forecast range of 3.1 percent to 3.9 percent for the month.

Average inflation in the first quarter of 2026 settled at 2.8 percent. That first-quarter average remained below the BSP’s full-year target of 3.0 percent. It also stayed within the central bank’s tolerance range of plus or minus 1.0 percentage point around the target.

Inflation for households in the lowest 30 percent income group also rose, climbing to 4.2 percent in March from 2.5 percent in February.

The BSP said the March inflation outturn highlighted upside risks coming from the global oil price shock.

The central bank said headline inflation rose mainly because domestic petroleum prices surged as the ongoing conflict in the Middle East disrupted key global oil supply channels.

Electricity rates also increased due to higher transmission and generation charges. Food inflation likewise went up because of higher domestic rice prices.

Authorities said farmgate prices rose during the lean season. Postharvest, transport, and logistics costs for rice also increased due to higher fuel prices.

On a month-on-month seasonally adjusted basis, headline inflation accelerated to 1.6 percent in March from 0.4 percent in February.

Core inflation, which excludes volatile food and energy items, also rose to 3.2 percent in March from 2.9 percent in February.

The BSP said the March 2026 inflation rate of 4.1 percent settled above its announced forecast range of 3.1 percent to 3.9 percent.

It said the overshoot was largely driven by higher transport-related costs following the sharp increase in domestic fuel prices.

The BSP also cited higher prices of key food items, particularly rice.

The Philippine Statistics Authority said non-food inflation rose to 4.9 percent in March from 2.8 percent in February.

Private transport inflation surged to 31.3 percent from negative 3.1 percent amid higher fuel prices.

Food inflation also picked up to 2.8 percent from 1.6 percent. Rice inflation reached 3.6 percent after 14 months of deflation.

Vegetable inflation climbed to 6.9 percent from 6.1 percent. Fruit inflation also increased to 5.1 percent from 3.8 percent.

The BSP warned that the inflation risk environment has significantly shifted to the upside because of the ongoing conflict in the Middle East.

It said a sharp and prolonged oil price shock could trigger spillover effects and broaden price pressures across the rest of the consumer price index basket.

The central bank also warned that this could disanchor inflation expectations and generate further second-order impact.

“Looking ahead, mounting risks to the inflation outlook require sustained vigilance. The BSP will carefully consider incoming data at its upcoming monetary policy meeting to assess the need for action in keeping with its price stability mandate.”

The Department of Economy, Planning, and Development said the government has already rolled out coordinated measures to address the uptick in inflation and cushion the effects of the Middle East conflict on households and key sectors of the economy.

“The government stands ready to address emerging inflation pressures through strategic, well-targeted, and time-bound interventions, particularly in fuel, transport, and food,” said DEPDev Secretary Arsenio M. Balisacan.

Balisacan said the issuance and operationalization of Executive Order No. 110, or the Unified Package for Livelihoods, Industry, Food and Transport, or UPLIFT Committee, is helping the government identify strategic measures.

To stabilize domestic fuel supply and ease transport costs, the government has activated its emergency fuel procurement program.

Under that program, 165.6 million liters of diesel have been secured for delivery through April.

Toll rebates for public utility vehicles and cargo trucks are also being rolled out on major expressways.

To protect consumers and ensure adequate food supply, the government has issued anti-hoarding guidelines.

The guidelines are meant to prevent artificial fuel shortages and maintain orderly distribution.

The PHP 20 rice program has also been expanded nationwide.

The government has also deployed logistics support to move vegetables from Benguet to Metro Manila.

Reduced roll-on, roll-off terminal fees for vehicles carrying raw agricultural products are also being implemented to keep food movement efficient and affordable.

The government said it is also extending targeted assistance to vulnerable sectors, including public utility vehicle drivers, farmers, and fisherfolk.

That support includes service contracting, cash assistance, and fuel subsidies.

“Our immediate priority is to ensure the safety of Filipinos abroad and to deploy timely and tangible solutions by providing critical support for the transport sector, commuters and industries, while simultaneously diversifying the energy mix. The government is firmly committed to ensuring the continuous delivery of services, even as we pursue decisive measures to enhance the resilience of our economy and institutions, carefully balancing short-term relief measures and longer-term considerations toward enabling the economy to recover high growth quickly,” Balisacan emphasized.